Key figures - an important tool

Financial ratios are accounting figures that provide the foundation for a deeper financial analysis - an analysis that describes a company's financial situation. But often, a simple calculation of a company's ratios is actually sufficient.

For companies that want to gain insight into the financial situation of their customers and suppliers, KPIs are essential. The analysis of key figures is commonly referred to as a key figure analysis. The analysis provides a quick overview of the company's financial situation - and not least to assess the development of the various elements that make up the economy. In other words, the key figures make it possible to easily and more clearly see the development of the business. There is basically no limit to which key figures you want to work with. In this article, we focus on the most important ones.

A KPI analysis is usually an element of a larger financial analysis for internal or external use. But ratios are also highly relevant when you need to assess the creditworthiness of a potential or existing customer.

Most large companies use key figures in their annual report to create an overview and hopefully show a positive development. However, not all annual reports make full use of key figures. The vast majority of companies have not included calculation methods and explanations in their financial statements. In this short article, we will therefore discuss some of the most important key figures. At the same time, we will provide formulas so you can work out the individual ratios on your own.

In this section, we will briefly review the key metrics that we believe are the most relevant to work on and analyze before granting credit to a customer.

Tip: The above are the most important key figures to look at when assessing whether a company has a healthy and profitable economy. That said, a healthy economy is essentially based on a company making a profit - in other words, positive operations. That's why you should pay extra attention to the solvency and liquidity ratio.

With a solution from Qatchr, you don't have to manually calculate relevant key figures and make your own credit rating based on them. Qatchr performs the analysis for you and based on it, we create a nuanced credit check. We calculate all the important key figures for you and show the historical development. This gives you a complete overview of your customer's or supplier's finances. At the same time, we calculate the company's credit score, credit maximum and maximum number of credit days, which you can use to draw up a sensible credit policy.